Rio keeps up sales offensive on Chinalco deal

Chinalco's proposed $US19.5 billion ($A26.1 billion) deal to take a stake in Rio Tinto was in Australia's long-term interest, a Rio Tinto executive has told a meeting in Melbourne.

Rio Tinto's global head of strategy Doug Ritchie told a Committee for the Economic Development of Australia lunch in Melbourne that Australia could lose enduring export markets if it failed to embrace foreign investment.

"There is considerable evidence that the investment and other benefits it entails ends up elsewhere," Mr Ritchie said.

There has been recent debate about the deal with Chinalco.

Some investors believe the deal is overly generous to the Chinese state-owned enterprise while others think it will allow China too much influence over iron ore prices.

Federal Opposition leader Malcolm Turnbull has said the deal should not proceed as it was not in Australia's national interest.

But Mr Ritchie said there were no documented cases of state-owned investments causing significant problems in host countries.

"One of those popular myths in circulation is that foreign investment sucks out wealth from a country," Mr Ritchie said.

"Research shows that for every dollar of income generated in Australia 95 cents remains in Australia and only five cents is sent overseas," he said.

Mr Ritchie said typical joint ventures with Chinese companies tended to have less minority protection than past deals with Japanese companies.

"The people of Australia will always have ultimate control over their country's valuable resources," Mr Ritchie told the meeting.